Biden-McCarthy meeting yields no debt ceiling deal, but speaker says markets should be encouraged

For House Republicans, however, that’s a non-starter. They view a vote to increase the government’s borrowing power and their demands for cuts to government spending as inextricably linked.

“If you have a child, and you give them a credit card and they spend it to the limit, you’re responsible for paying that credit card. But the responsible thing to do going forward is not just to raise the limit, but look at how you’re spending,” said McCarthy.

This comparison has become a familiar line from the Speaker, the implication being that while House Republicans don’t intend to let the United States default on its debt, they will insist on changes to how much money the government spends.

But just what those changes would be remains a mystery, and an area of contention within the House Republican caucus.

Asked by reporters at the White House what spending cuts he was seeking, McCarthy replied, “I’m not going to go negotiate this in the press.”

Over the coming months, McCarthy’s job is to build consensus within his caucus on what spending cuts he should push for during debt ceiling negotiations.

It’s a task further complicated by the fact that not all of his GOP caucus members share his belief that the government must raise the debt ceiling at all.

Several fiscal hardliners in the House have already made it clear they’re willing to force a default on the national debt if they don’t get massive spending cuts in return for passing it.

The trouble with these demands are that any debt ceiling bill the House approves must also be able to win 60 votes to pass the Democratic-controlled Senate before the president can sign it into law.

In the Senate, the sort of draconian spending cuts sought by some far-right House Republicans would have no chance of passing.

On Wednesday, the Democratic Senate Majority Leader Chuck Schumer of New York reminded the House speaker of his challenge.

“For days, Speaker McCarthy has heralded this sit-down as some kind of major win in his debt ceiling talks,” Schumer said on the Senate floor. “Speaker McCarthy, if you don’t have a plan, you can’t seriously pretend you’re having any real negotiations.”

Article source: https://www.cnbc.com/2023/02/01/joe-biden-kevin-mccarthy-meeting-yields-no-debt-ceiling-deal.html